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It’s capitalism Mike but not as we know it

The trailer for Michael Moore’s latest film “Capitalism: A Love Story” is now out. The film is due for release in October and Moore says he made it as if it was “the last film I was ever going to make.” Looks like he’s aptly chosen M.I.A.’s Paper Planes as the soundtrack too.

Despite criticism that he cherry picks footage and data to suit his own ends, I’m looking forward to seeing this. However, I hope Moore looks at how capitalism doesn’t really exist in the real world. As the bailouts proved in its crudest form, what we actually have is closer to socialism – socialism for the rich that is. Markets are so distorted by governments and corporations working hand-in-hand that calling it “capitalism” is about as accurate as calling Stalinist Russia “communist”. Using the term capitalist only serves to maintain misunderstanding of the current system and give ammunition to those who support it to dismiss opponents as simply “anti-capitalists.” Don’t ask me what a better term would be but something along the lines of “state-sponsored-capitalism” rolls off the tongue, erm, badly.

24 thoughts on “It’s capitalism Mike but not as we know it”

“As the bailouts proved in its crudest form, what we actually have is closer to socialism” – with all due respect, this is silly. There is no egalitarian or redistributive urge behind the system we’re currently stuck with.

Instead, the larger banks effectively own our governments, forcing them to bankroll debts and liabilities “for the good of the economy”.

If we had anything resembling socialism, we’d be better off than we are now.

I couldn’t agree more but you didn’t finish my sentence you quoted – i.e “…what we actually have is closer to socialism – socialism for the rich that is.” Which is exactly the unjust situation you describe.

Then it’s not socialism. Maybe I’m nitpicking but ‘socialism’ is a term that seems to be endlessly misused. ‘Socialism for the rich’ doesn’t really mean anything. It’s like saying “Gardening for cars” or something.

Since corporations are “socializing” their losses, I think “socialism for the rich” is a perfectly justified term for it. However, so as not to get bogged-down in a debate over the definition of the word, maybe “welfare for the rich” would be the most accurate description of it.

By the way, “Gardening for cars” reminds me of when Alan
Partridge was desperately searching for ideas to pitch to Tony Hayers e.g. “Youth hosteling with…Chris Eubank”. It’ll probably be on TV within the year.

Well, in the sense that everything that occurs probably has an effect on society, then it’s social.

I suppose that what I mean is that to me, there’s a great misunderstanding going on about whether and how capitalism has changed over the last year or so. The consensus seems to be that all these bail-outs are somehow an aberration and that capitalism has been shaken, that it has changed.

My point of view is that nothing of the sort has happened. Capitalism has been operating a business as usual policy through the entire crisis: it thrives on economic ‘cycles’, boom & bust, and debt. Finance controls government and demands payment when the market contracts. This is normal, has happened before and will happen again.

So, in other words, a better name than ‘socialism for the rich’ would be ‘capitalism’ 🙂

I definitely agree with you that it’s a misconception to believe the bailouts are something new and have redefined the economy. Governments have been bailing-out and fighting wars for corporations since capitalism began and the only new thing about the recent bailouts was the publicity surrounding them. As you say, it’s “business as usual”.

However, I don’t agree that what we’re seeing is capitalism – that was the whole point of my post. The original idea of capitalism was healthy competition on a level playing field – not bailing out huge companies when they got greedy and gambled beyond their means. What we currently have is more a type of state-sponsored-capitalism where corporations and governments are working in hand in hand to maximize their power and profit.

That’s what you’d expect from a corporatist/fascist economic system – not a genuinely capitalist one.

Not being an economist or ever wanting to be one..even if I have a masters in one..how does that work. What do they say would have happened if the banks had not been bailed out..what would it have meant for the wider economy..small business, self-employed etc.

It’s a good point and I agree that doing nothing would have had a catastrophic effect on the economy and people’s livelihoods. However, the bailouts were presented by both the government and mainstream media as the only way to remedy the situation. Writing a blank cheque of public money to corporations with few or no strings attached was an unjustified gift to Wall Street.

Rather, the public should have gotten something back for “donating” all that money i.e. the government should have taken some stake in the companies bailed-out. Ok, you can argue that the government are hardly going to use their stake to run it in the interests of the general population but it’s still a lot more democratic than granting all that power to shareholders, bankers and investors instead. Even many mainstream economists including Simon Johnson – a former chief economist at the International Monetary Fund (and therefore hardly a left-wing loony) – suggested as much in an interview with National Public Radio which reported:

“Johnson and a number of other prominent economists suggest a Warren Buffet approach instead: Buy shares in the company.

“You don’t want to do this in a halfhearted, backdoor way,” he said. “You gotta be transparent, come all out, go for preferred shares for the government in return for new capital. Wall Street is not going to like it, but that’s tough. We’re way beyond only doing things that Wall Street likes.”

There are other ways it could have been done more democratically too. The whole report is worth reading or listening to actually and can be found here:

They were my thoughts more or less from a non educated position. Be interesting to know how catastrophic this economic crisis will prove to be for the developing world. No doubt big, plus the double impact of a reduction in development budgets.

An interesting thing about the crisis in capitalism (do we still call it that?) is the way voters right across Europe seem to be turning in increasing numbers to parties of the capitalist right, rather than the socialist or even social democratic left.

It’s like coming out of an abusive relationship and deciding a career in cage fighting is the way to go.

@Ed, I think you’re right. Many Third World countries have been going through one long financial crisis since they were plundered by the West hundreds of years ago but the financial crisis can surely only exasperate their situation. If the crisis has proved one thing though, it’s that the Western economic models pushed on them by the IMF are certainly not the way to go. What they need more than ever at this time is to be completely freed of the unjust debts that enslave them so that they can build their own budget surpluses for times like these as is argued here:

@Soft Mick, That’s one way of putting although I’m not sure it’s as simple as that. I presume you’re mainly referring to the UK where I don’t think huge numbers of voters are shifting rightwards. Rather, they are utterly disillusioned with the social democratic alternatives on offer. Based on New Labour’s performance over the past decade, this is hardly surprising and that’s why many of their voters are switching to the Conservatives (who they don’t regard as much different nowadays) and in some places, even the BNP and any other right wing party that promises to fix everything.

There’s a good article about this here looking at whether the UK is really moving right based on the local election results:

“Firstly, the election as a whole was fought on the basis of right wing politics. Crime and immigration dominated the issues being discussed, and this was a deliberate decision on the part of the main parties. When that happens it is much harder for a space to the left to open up, especially when Labour goes along with the consensus of more police on the streets and being tougher on crime.

More fundamentally, traditional Labour voters were punishing Labour for the 10p tax, the rise of food and utility prices, the housing crisis and much more besides. In the circumstances of a right wing and unpopular Labour government, staggering on after 11 wasted years, it is unsurprising that some voters saw little difference between Labour and the Tories.”

Interestingly though, she adds:

“At the same time as these electoral gains for the right, there was another story during the election period. Teachers, lecturers and civil servants struck and demonstrated on 24 April. The demonstrations on that day were some of the youngest and most militant workers’ demonstrations for at least a generation.”

The main problem is that social democratic parties such as Labour are not presenting a social democratic alternatives because they long ago abandoned their social democratic principles. Now is exactly the time when they should be pushing socialist or social democratic alternatives more than ever before but because they’re so entwined with capital and business, they won’t.

No, I really don’t mean just in the UK. That’s the thing – if it was just the UK then you could explain it all away as an unpopular government that’s been in power for so long that it’s lost its way a bit and opposition parties have finally got their act together.

I’m talking more about this year’s European Elections, in which pretty much all states across Europe upped their support for parties of the right. Spain being one of them. It’s a bit of a contrast to the US, where they obviously went completely the other way in their presidential elections.

(And, yes, I know you can argue that Obama isn’t the most left wing person on the planet but he’s clearly a more liberal alternative to the republicans.)

I think there’s two main reasons for that. One is that, as in the UK, social democratic parties across Europe are not challenging the neo-liberal model and are getting into bed with business. Supporters are simply abandoning them in droves because they don’t see them as defending their interests anymore. Which leads onto the second reason – 60% of Europe didn’t even bother to vote in the elections because they didn’t see the point. Under such low turnout circumstances, it’s always the far right that prospers. So I don’t think the majority of voters suddenly turned rightwards, I just think they stayed at home thus allowing the right to be more visible. There are some reasons for optimism though – environmental and some independent parties made moderate gains in the European Elections.

I think in the case of the USA, the situation was a little different. They had already veered severely to the right by electing the Bush administration which failed to answer their economic and social problems – in fact, they only made them worse – so it was inconceivable the population would veer even further to the right in search of solutions. Then, Obama came along – black, fresh faced, intelligent and an inspiring speaker – and they perceived that he embodied the change that they desperately want. As is becoming increasingly apparent though, although the population were hoping for a leftward swing, what Obama is doing is moving them slightly more towards the center to something closer to what they had under Clinton.

My point is that I consider the division between ‘capital’ and ‘state’ to be false. The ‘state’ is simply capital’s method of control: it maintains those who have capital in a position of power over those who don’t.

Capital drives practically all state operations, from the police and road construction to the commission of wars and the theft of resources. The state generates situations that benefit capitalists and in return, capitalists bankroll the state and keep it going.

The idea that last year’s bailouts are ‘unprecedented’ is wrong. Throughout history, capital and state have colluded to ensure favourable conditions for each other. This includes the introduction of tariffs and trade law, piracy, slavery, countless pieces of legislation and endless subsidies and enticements, tax breaks, and so on. The ‘free market’ where businesses ‘sink or swim’ without state intervention is nothing more than a fantasy, a false image projected onto capitalism to give it a moral mythology that people (especially the scientific protestants who really got capitalism going) could believe in.

For these reasons and more, it would be more or less impossible for any American president to bring about real systemic change. That can only happen by revolution and revolution is difficult when everyone’s obese.

We’re definitely on the same wavelength about this although I think we have some differences here and there.

Your assertion that there is no separation between state and capital reminds me of a Noam Chomsky quote about the USA when he said: “The country was founded on the principle that the primary role of government is to protect property from the majority – and so it remains.”

I absolutely agree on that point although should add that no matter how hopelessly a democracy has broken down, the one part of the state-capital equation that people can change for the better is the state through the democratic process.

As regards the bailouts, I repeat, I’m in total agreement with you in that there was nothing “unprecedented” about them and I don’t remember saying at any stage that they were. You describe very eloquently exactly why too.

However, I don’t agree that change is impossible. People have overcome a lot worse in history with far few privileges and resources than we have today! I think a lot can be learned from South America in this respect where not so long ago, dictators and murder squads were running around and now significant steps have been taken to improving the lot of the poor.

Revolutions don’t happen overnight and as with all change, it’s the activists and those organising at the grassroots over years and years that eventually yield some results. Dramatic systematic change might not happen in our life times but if you feel strongly enough about it, then it’s worth doing what you can for your own children and future generations.

I guess revolution should start with changing our own behaviour..but it is very easy to talk revolution from the comfort of our flats and houses around the developed world but to then get out with action is a different story. I feel a little disempowered and un-educated to know what to call for in a revolution! Maybe I just get on with moving back to Wales..2nd time round!

As I think the saying goes, “Dissent without action is consent” and you’re very right. I’m as guilty of that as anyone and I think that’s one of the dangers of the internet and blogging. It’s very easy to vent anger and point out what’s wrong with the world in a blog post and then carry on life regardless without doing anything.

As regards calling for revolution, I don’t think that’s the realistic way to go right now anyway although I agree that it’s difficult to know where to start. I don’t think you’re uneducated or disempowered though. You sound like you’re more than aware of these problems and you’ve got many opportunities to do something even if it’s just donating money to an organization that’s trying to make changes. I think the misconception is that people think they’ve got to go out there like Che Guevara and smash the system somehow but that’s not realistic or really necessary.

I guess I am not too un-educated but I do get a little tired and to some extent dis-empowered by left wing rhetoric..especially when it fails to look at the debate as a whole. In terms of action..I am leaving my world in sustainable transport at sustrans and moving into a international development job..finally. But have got to move back to Wales to do it. Not sure it is part of the revolution but hopefully not doing too much harm and hopefully a bit of good.

Yeah it should be good..developing links between grassroot communities groups in Wales and grassroot orgs in Sub-Saharan Africa. I guess left wing rhetoric I am referring to the damn this damn that culture..the state is evil blah blah blah!

I actually think there’s not enough “damn this, damn that” going on – it’s called dissent and the more people that are doing it, surely the less alone and the more empowered you should feel. I don’t think enough people are questioning the role of the state otherwise democracy might not be so damaged as it is. And criticizing the state isn’t just exclusive to the left-wing – the right would happily see it further dismantled if it means putting more power in private hands.

Of course but I often see mostly by bloggers and mass media to be honest is biased, one sided uneducated rants..that is what pisses me off. It does not matter if it is rigth or left. All that it does is switch off the masses and makes the arguement for questioning the role of state look stupid. Plus it is often comes from people (not talking about you) who do very little themselves to make things better for other people. Just intent of attacking the state. As you know I have worked within Government and they do attempt to do good. Of course it is not individuals..it is systemic.

Ok I see what you mean – that basically it´s difficult to sort the wheat from the chaff so to speak when it comes to rational reasoned political commentary. I think that´s definitely true and all you can do really is investigate and decide from yourself if someone´s perspective is rational or factual – which of course, most people don´t have time to do. I think there is so much flak and propaganda out there from both sides that it is easy to feel “disempowered” or simply turned-off by political debate as you say. I think though that there is a lot of disillusionment with both right and left rhetoric nowadays and if someone does come along and puncture both sides with rational, reasoned non biased logic, people do recognise that and take note. Which is why it´s important for people that don’t align themselves with either side to keep going, keep analyzing and keep dissenting.

I agree about the inaction part – dissent is all very well but the only people worth really listening to are those that have the courage of their convictions and actively do something about it. Everything else is hot air and shouldn´t be taken very seriously. Anyone can just bitch about the state of the world from the comfort of behind a keyboard.